Nestle Nigeria sustains impressive performances in Q1

Nestle Nigeria Plc maintained its blue chip status in the first quarter of 2019 by posting impressive feats in key performance indicators.

During the period, the company posted N19.121 billion as profit before tax, an increase of 40.18 percent from the N13.64 billion in the comparable quarter of 2018. The bulk of the profit came from the N13.126 billion from the food segment, marginally better than N12.743 billion in 2018 while the beverage business segment recorded the biggest percentage growth at N5.96 billion, up from N1.775 billion in 2018.

Profit after tax improved by 49.27 percent to N12.846 billion from N8.605 billion in 2018, translating to earnings per share of N16.21, compared to N10.86 in Q1, 2018.

A further breakdown of the result submitted to the Nigerian Stock Exchange (NSE) showed that revenue for the period inched 5.19 percent higher from N67.463 billion to N70.966 billion. Cost of sales dropped by 5.29 percent to N39.497 billion from N41.705 billion in 2018, resulting in gross profit of N31.468 billion, higher than N25.757 billion in the corresponding period of 2018. Tax expense jumped by 24.64 per cent from N5.034 billion to N6.274 billion.

Marketing and distribution expenses increased by 14.86 percent from N9.029 billion last year to N10.371 billion; even as administrative expenses dropped by 8.97 percent from N2.208 billion to N2.01 billion, leading operating profit at N19.086 billion, up by 31.46 percent from N14.519 billion.

Finance income, being interest income on bank deposits, increased to N504.003 million from N281.299 million, finance cost dropped from N1.159 billion from N469.353 million, with interest paid on financial liabilities dropping to N488.205 million, down from N521.221 million, just as net foreign exchange gains stood at N18.852 million, as against the N638.669 million loss in the corresponding period of 2018. As a result of this, net finance income stood at N34.65 billion, compared to the preceding first quarter’s N878.591 million costs.

Market analysts are of the view that the company has entrenched a business model that is capable of consistently delivering satisfactory results, aided by customer loyalty and staff motivation, which are essential in meeting the expectations of customer, shareholders, employees and other stakeholders.

Speaking recently, the Managing Director/Chief Executive Officer of Nestle Nigeria, Mauricio Alarcon said, “We are pleased with the sustained growth of our company amid the competitive environment. Sustained focus on creating value for our consumers and increased efficiency in our operations also contributed to our results. We continued to invest in our most important asset, our people, as well as in product innovation to delight consumers.”